Asset backed securities are relatively safe investments

Assignment Help Financial Management
Reference no: EM131180087

Asset backed securities (ABS) are relatively safe investments because

A. because the pool of assets backing the securities is often much larger than the bond issue.

B. Because the debt pools are highly diversified

C. because the loans in the pool are collateralized with valuable assets such as cars adn trucks

D. they are collateralized only with the highest quality loans.

Reference no: EM131180087

Questions Cloud

What is the crossover rate and what is its significance : FIN 534 - Homework What is each project's MIRR at the cost of capital of 10%? At 17% and what is the crossover rate, and what is its significance?
Calculate the variance of portfolio of the three securities : Suppose you purchased $1,000 of Stock A with your own money. You then borrowed $500 and used this money to buy Stock B. This means that the portfolio weights are as follows: wA = 1000/1000 = 1.00; wB = 500/1000 = 0.50; wC = -500/1000 = - 0.50. Calcul..
Calculate the seepage flow rate : Determine the pressure distribution along the base of the dam and beneath the apron. Calculate the uplift forces on the dam foundation and on the apron.
Website as input and conducts : Write a PythonScriptthat takes a website as input and conducts anhttpbanner grab on the website. Take a screen shot of the code and the output and submit in a .doc/.docxfile.
Asset backed securities are relatively safe investments : Asset backed securities (ABS) are relatively safe investments because
Senior systems administrator : Imagine you are a senior systems administrator who has been tasked with considering whether or not to implement server virtualization into your organization's computing operations of multiple sites with a server count of more than 400.
How does an ipo relate to a harvest : What is the primary purpose of an initial Ix offering SIPCO? - How does an IPO relate to a harvest?
Write essay on responsibility of army non-commission officer : Prepare a 2500 word essay on duties and responsibilities of an Army non-commission officer (NCO) paper must be typed in American Association (APA) format, Time Roman, Font 12.
How does her risk profile fit into the time horizon : In Sharon's case, there are certain variables to consider, such as: How does her risk profile fit into the time horizon she has selected to purchase her first home

Reviews

Write a Review

Financial Management Questions & Answers

  Cash outflow in cash budgeting is mainly due

Cash outflow in cash budgeting is mainly due to: A. Capital expenditures B. Labor costs and other expenditures C. Payments on accounts payable D. Taxes, interest payments and dividend payments

  Evaluate the costing process and procedures

Evaluate the costing process and procedures of the organisation with respect to method or approach utilised - capital decision making process within the organisation with regards to what methods are utilised, how such methods are chosen, how project..

  Determine the effective annual rate of return

An engineer deposits $540 each month into a retirement account. After 30 years, the balance in the account is $1.9 million. Determine the effective annual rate of return for this account. Express your answer in % (not decimal) to the nearest 0.1%.

  Unrestricted cash classified within current assets

Companies typically report compensating balances that are required under a loan agreement as unrestricted cash classified within current assets. a. For purposes of financial statement analysis, is this a useful classification? Explain. b. Describe ho..

  Nearest one hundredth of one percent-the bonds yield is

A 3-year bond paying 4% annual coupons pays $1000 at maturity. Today the bond sells for $986.98. To the nearest one hundredth of one percent, the bond's yield is?

  Use of automatic reordering system is appropriate

Use of automatic reordering system is appropriate for which type of buying situation?

  Project is estimated to have a net present value equal

A project is estimated to have a net present value equal to $85,000. The risk-adjusted opportunity cost of capital is 15 percent. Which of the following statements is most correct?

  Expected return on portfolio-expected returns on stocks

You own a portfolio that has $3,100 invested in Stock A and $4,200 invested in Stock B. Assume the expected returns on these stocks are 11 percent and 17 percent, respectively. What is the expected return on the portfolio?

  Compute the delta and gamma of the at-money-put

The underlying asset Is $50 with volatility 15%. An at-the-money call option has a price of $5. The call has a Theta of 2.65 and a Gamma of 0.05. The risk-free rate is 5%. Compute the Delta and Gamma of the at-money-put and use them to estimate the c..

  Analyze the balance sheet and income statement

Case Study: Publix Super Markets, IncIn preparing your written case analysis, follow the steps outlined below. Identify the company's financial position:Analyze the balance sheet, income statement and statement of cash flows

  Market expected return

A stock has an expected return of 15 percent, its beta is 1.55, and the risk-free rate is 6.5 percent. What must the expected return on the market be?

  Coupon bonds on market-what is the effective annual yield

PK Software has 8.4 percent coupon bonds on the market with 23 years to maturity. The bonds make semiannual payments and currently sell for 110.25 percent of par. What is the effective annual yield?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd